Did you know that 95% of American households own a car? Besides the convenience that a car brings along, having a car can help you get a loan. A car title loan is one of the ways to get the required cash fast, especially if your credit score isn’t attractive.
If you want to know more about a car title loan and how it works, keep reading. Our comprehensive guide has outlined everything about a car title loan.
What Is a Car Title Loan?
A car title loan refers to a short-term loan where borrowers use their car as collateral. These loans are also referred to as auto title loans. You’ll only pay a sizeable amount for the loan, and you won’t need good credit.
Lenders have different terms and limits on the money you can borrow. Typically, the lender will hold on to your vehicle until you pay. You can visit this website to know more about car title loans and their terms.
How Does a Car Title Loan Work?
Once you get a title loan lender, you can start the loan application immediately. You need to have all the documents showing that you own the car. Consumers can get a loan of up to 26% of the assessed value of the vehicle.
You need to bring your vehicle, proof of insurance, photo ID, and clear title to fill the application. Most lenders hardly check your credit score. They also don’t focus on your income as the main interest is the car and its ownership.
Contrary to common opinion, you don’t have to turn your car over as you can drive it throughout the repayment period. With these loans, the repayment period is usually 30 days or even more depending on your lender.
Failure to repay the loan puts your car at risk of repossession. How the lender handles the proceeds depends on the rules in a state. It is crucial to ensure that you repay the loan and the interest as agreed to avoid these punitive measures.
Benefits of an Auto Title Loan
Getting a car title loan has significant benefits that you wouldn’t find in most other common types of loans. With an auto title loan, you’ll get the cash instantly. If you have an urgent need, the loan will come in handy.
The processing time is also minimal since you don’t require endless procedures. Car ownership details are the only documents you’ll need to get the cash in your account.
You don’t have to worry about car requisition when getting a car title loan. You can drive it freely throughout the repayment period. Auto loans also don’t require you to have a commendable credit score or guarantors, which is a common requirement for many other loan options.
A Car Title Loan Is an Ideal Way to Get Cash Instantly
Getting a loan from traditional bankers such as banks isn’t always easy. The requirements can be discouraging especially if your credit score is nothing to write home about. A car title loan is a perfect alternative if getting the loans seems complex.
Ensure that you get a reliable lender to avoid frustrations. The lender will get the cash in your account sooner than you can imagine.
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